Mike McNamara: Technology Transformation on Tap at NRF’s Big Show

January 18, 2017

Target Chief Information and Digital Officer Mike McNamara spoke this week at the National Retail Federation (NRF)’s annual Big Show in New York. In his keynote, Mike described how Target’s technology team is leading the way on transformation. Read on to hear from Mike about the change he’s leading, and some of the exciting technologies he saw at the Big Show.

I’ve been attending the annual NRF show long enough to remember when there were as many vendors showing off the latest in shelves and fixtures on the expo floor as there were vendors selling technology. Today, NRF is a full-on technology show that attracts all the tech giants and a slew of startups.

It’s a great show for engineers, like me, with a passion for retail and for dreaming up how new technologies can change the way consumers shop—and the way merchants operate. So I was honored to get to share a bit about Target’s journey at this year’s Big Show. Here are highlights of what I shared:

When I joined Target about 18 months ago, what I found was a technology team that was over-sized and over-committed—to the tune of 800 projects we had underway. We were overly rigid in how we operated, and we were far too reliant on third-party contractors. In fact, contractors accounted for about 70 percent of the team, while just 30 percent were team members.

It was untenable. We had to change the way we worked. And I’m proud to say that Target’s technology team has done just that, and we’ve got tangible results to show for it. We’ve eliminated hundreds of project and flipped that team member-contractor ratio to 70-30. We’ve also enhanced Target’s technology—in terms of both stability and flexibility—and we can now remedy issues far faster than we could just two years ago.

In many ways, our progress thus far and our continued success boils down to three things. First is ruthless prioritization. I employed Post-It Notes with my peers throughout the company to whittle that technology to-do list of 800 projects down to size. No PowerPoint decks. No spreadsheets. Make it fit on a few Post-It Notes. Because in technology, less is often more. We must focus on doing fewer things better.

Second, we brought our engineering team in-house by hiring more than 700 new engineers and by drastically culling our contractor base. We need to have a great, in-house engineering team and culture, and that’s why we’re focused on hiring more women technologists. In fact, we’re working toward an ambitious goal of 50 percent female hires for entry-level engineering roles over the next year.

Third is working in an agile way. What I’m perhaps most proud of is how our new way of working is taking root in other parts of Target, beyond technology teams. Agile sets us up for more innovation and for becoming a leader in how technology and data science can (and will) enhance the retail experience.

We’ve got lots of work to do still, of course, but I’m excited about the progress we’ve made and what’s in store for Target’s future.

This week’s NRF show was all about the future and transformative technologies. Some of the best stuff I saw ranged from technologies designed for online fulfillment centers to chatbots to virtual and augmented reality experiences—both for shoppers and retail employees. Some of my favorites included:

I was impressed by a robotic arm designed for filling online orders that employs a suction system to grab items without damaging them. The brains of the robot employs machine-learning so that it will take a different approach to moving an item should it run into any issues.

Another standout, also designed for a distribution center, was a virtual reality technology that’s built into eyeglasses to help a team member identify and pick product, with a virtual indicator notifying the team member where to place the product.

There was buzz about chatbot technologies that essentially help power text messages that guests can use to conduct e-commerce, or simply use for help with basic store information such as hours and location. I also am among the chorus who strongly believes that voice-activated applications—think Google Home, Amazon Echo or Siri—are bound to see lots of commerce exploration over the next few years.

There were some impressive novelties, including a machine that can knit a customized sweater in less than an hour, and also lots of technologies designed to harness data to enhance the store experience. I saw some really exciting new systems in this space that can help retailers deliver more relevant product recommendations to guests while they’re shopping and also make it easier for them to shop—and buy—from expanded online assortments.

As I mentioned in my talk on Monday, neither Target nor these technology vendors can predict the future and which emerging trends will catch on. But it’s clear that we in technology are creating the future of retail. And I can’t wait to see how it turns out!

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